STATEMENT TO

[First Reprint]

SENATE, No. 3270

with Senate Floor Amendments

(Proposed by Senator POU)

ADOPTED: DECEMBER 16, 2019

      These amendments remove a provision of the bill that prohibits insurers from offering, issuing, or renewing stop loss insurance policies of any kind to small employers.

     The amendments provide that, in order to be sold to a small employer in this State, a stop loss policy must establish a per person attachment point or retention or aggregate attachment point or retention, or both, which meet the following requirements:

     (1)   If the policy establishes a per person attachment point or retention, that specific attachment point or retention may not be less than: $40,000 for all stop loss insurance policies written, issued, administered or renewed on or after January 1, 2020; $45,000 for all stop loss insurance policies written, issued, administered or renewed on or after January 1, 2021; and $50,000 for all stop loss insurance policies written, issued, administered or renewed on or after January 1, 2022; and

     (2)   If the policy establishes an aggregate attachment point or retention, that aggregate attachment point or retention may not be less than 150% of expected claims per plan year.

     The amendments also provide that a stop loss insurer may not consider the health status or prescription drug use of an eligible employee or a dependent in the marketing, offering, or pricing of stop loss insurance to a small employer, and may not deny stop loss insurance coverage to a small employer on the basis of the health status of an eligible employee or a dependent.

     The amendments require a stop loss insurer to renew, at the option of the small employer, a stop loss insurance policy written, issued, administered, or renewed on or after January 1, 2020, or in force on or after January 1, 2020 except in certain circumstances.

     The amendments provide that the stop loss insurance requirements do not apply to stop loss insurance issued to a multiple employer welfare arrangement that is in compliance with P.L.2001, c.352 (C.17B:27C-1 et seq.).  This exclusion only applies to stop loss insurance provided to a multiple employer welfare arrangement, and does not apply to the small employer groups that comprise the multiple employer welfare arrangement.